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Stocks Close Lower as OECD Cuts Global Growth Outlook; Financials Slide

NEW YORK (TheStreet) -- Benchmark U.S. stock indices closed lower Tuesday as the Organization for Economic Cooperation and Development cut its global growth forecasts and a health care deal was announced that will make Bayer the largest over-the-counter drug seller in North America. Financial stocks continued their fall from Monday.

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The S&P 500 was down 0.9% to 1,867.72 while the Dow Jones Industrial Average slipped 0.78% to 16,401.02. The Nasdaq fell 1.38% to 4,080.76.

  • In its Economic Outlook report, the OECD lowered its forecast for global economic growth from its November outlook, from 3.6% to 3.4% for 2014. It called on the European Central Bank to cut its interest rate, and take potentially additional measures to address low eurozone inflation. The organization said U.S. economic growth could expand at a 3.9% annual pace this quarter.
  • Mosaic (MOS) and AIG (AIG - Get Report) were among the biggest laggards in the S&P 500. AIG was off 4.14% after quarterly revenue missed estimates. Earnings per share beat by 14 cents at $1.21 a share. Mosaic was down 2.11% after reporting first-quarter earnings of 54 cents a share, 5 cents below expectations. TWTR (TWTR - Get Report) was another big decliner, plummeting over 17% on the expiration of the lockup time for nearly 500 million shares held by insiders. Financials continued their falls from Monday, with JP Morgan (JPM), Goldman Sachs (GS), Citigroup (C), Morgan Stanley (MS) and Bank of America (BAC) all lower -- the latter two off more than 2%.
  • The U.S. trade deficit fell 3.6% to $40.4 billion in March, broadly in line with expectations.
  • Athenahealth (ATHN) plunged more than 13.5% after Greenlight Capital's David Einhorn warned on Monday that the company could drop up to 80% and said his fund had a short position in the stock. Anadarko Petroleum (APC) climbed over 3% after raising its 2014 forecast for sales volume.
  • Merck (MRK) was down 2.59% after reporting the sale of its consumer care business to Germany's Bayer for $14.2 billion on Monday. Bayer said the deal would make it the second-largest over-the-counter drug seller globally and the biggest one in North America.
  • Ukraine casualties continued to rise. France warned Russian President Vladimir Putin that he will face ongoing pressure for Ukraine to hold a May 25 presidential election.
  • Germany's DAX was 0.65% lower while the U.K. FTSE was off 0.35%.
  • Markets closed higher Monday on better U.S. economic data after trading lower early in the session on poor Chinese manufacturing figures and Ukraine tensions.

-- By Andrea Tse and Jane Searle in New York

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